Savings Strategies Every First-Time Homebuyer Needs To Know

If homeownership is a goal for your future, you're likely focused on saving money. A top priority is ensuring you have a plan for expenses like closing costs and the down payment. Here are a few strategies to help speed up that process.

Budget and Track Your Expenses: 
Create a detailed budget and track your income and expenses to better understand your overall finances.

Cut Down on Unnecessary Spending:
Once you have completed your budget sheet and clearly understand your spending habits, take a close look at any non-essential items. You can redirect the saved funds towards buying a home by cutting back on these expenses. Remember, even the most minor expenses can accumulate over time. According to the National Association of Realtors (NAR), "The majority of first-time buyers did make financial sacrifices to purchase a home. For those who did, the most common sacrifices buyers reported were cutting spending on luxury goods, entertainment, and clothes."

Automate Your Savings: 
When determining the amount to save for your homebuying budget, consider setting up automatic transfers to make saving easier. Manually transferring money may lead to forgetfulness, but automatic transfers promote consistency and reduce the urge to spend elsewhere. According to Realtor.com, consider automating the process if saving is challenging due to the constant temptation to spend your paycheck. You can inquire with your employer about setting up direct deposit into multiple accounts or arrange automatic transfers through your bank.

Lean into Any Side Hustles You Have: 
Don't forget your side hustles. Do you have a gig you currently do or have done before to earn extra cash? Taking on part-time work, freelance jobs, or picking up a side hustle can help boost your savings.

Put any Unexpected Cash To Good Use: 
If you receive any unexpected windfalls, such as a tax refund, bonus, inheritance, or cash gift from family, consider putting it towards your house fund.

By implementing these strategies and prioritizing your savings over time, you can ensure that you're well on your way to having enough to purchase your first home. As Ramsey Solutions emphasizes: "Budgeting shows your money who's in charge (that's you). It gives you the power to tell your money where to go instead of having to wonder where it went. It's how you make any money goals happen—like saving for a down payment."

Bottom Line
If you require additional strategies to prepare for buying a home, contact the Just Say Home KC team—we are here to help you realize the dream of home ownership in Kansas City and beyond!

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